NEW YORK ( TheStreet -- Microsoft ( MSFT) has upped the ante in the battle of the operating systems, slashing the price of its Windows 7 offering in an attempt to woo students onto its software.

The software giant, which faces stiff competition from Apple's ( APPL) recently-launched Snow Leopard, unveiled its win741.com Web site this week to sell its software into college dorms.

For a limited time, college students can buy Windows 7 for a reduced price of $29.99, a similar entry-level price tag to Snow Leopard. Describing the offer as "too sweet to pass up," Microsoft has cut the student pricing from $119.99 until Jan. 3, 2010.

The offer applies to Windows 7 Home Premium and Windows 7 Professional editions, and eligible students can choose to download either 32-bit or 64-bit software.

Microsoft's move is a clear indication that the tech bellwether is rattled by Snow Leopard, which has been garnering plenty of attention since its launch in late August. Figures released Thursday by NPD Group indicate that Snow Leopard has been flying off the shelves, easily eclipsing the launches of its predecessors, Leopard and Tiger.

Touting Snow Leopard as faster, more robust, and half the size of OS X Leopard, Apple also slashed its pricing for new OS's launch, increasing the pressure on Microsoft. With a single-user upgrade priced at $29 and a five-user Family Pack that costs $49, the company is attempting to combat declining hardware revenue and challenge the perception that Macs are more expensive than PCs.

Shares of Microsoft, which also competes with Google ( GOOG ) in Internet search, rose 5 cents, or 0.2%, to $25.35 Friday, as the Nasdaq dipped 0.03%.

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